Apple will invest $1.5 billion in Globalstar to expand satellite coverage

Apple will invest up to $1.5 billion in Globalstar to finance the expansion of its iPhone communications services, the satellite provider said in a regulatory filing on Friday.

Shares of Globalstar rose more than 30%, while Apple fell about 1.4% a day after predicting tepid quarterly revenue growth.

Under the financing agreement, Apple will commit $1.1 billion in cash and also buy a 20% stake in Globalstar for $400 million. The satellite company said it will use some of the money to pay down debt.

This move is another in a series of partnerships between space companies and mobile service providers seeking to provide satellite-based connectivity to customers in regions with limited network access.

Globalstar also said it will allocate 85% of its network capacity to Apple. The deal is expected to close on Tuesday.

The iPhone maker partnered with Globalstar in 2022 for a feature that allows Apple users to send emergency messages from remote areas.

© Thomson Reuters 2024

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